Karachi: The Pakistan Credit Rating Agency Limited (PACRA) has maintained its entity ratings for Engro Elengy Terminal (Private) Limited (EETPL), citing its pioneering role in the LNG industry and strong backing from its parent companies.

According to The Pakistan Credit Rating Agency Limited announcement issued on 04 July 2024, the ratings are supported by the strong business profile of EETPL, its strategic importance in managing Pakistan's energy needs through imported LNG, and the financial and operational backing from Engro Corporation Limited and Vopak LNG Holding B.V. The terminal, equipped with an installed Floating Storage Regasification Unit (FSRU), guarantees a capacity of 630 million standard cubic feet per day, with a peak capacity of 690 million standard cubic feet per day, ensuring a significant and recurring revenue stream. In the first three months of 2024, EETPL reported revenues of PKR 5.2 billion, continuing from its 2023 revenues of PKR 21.3 billion. Operational reliability remained high with a 97% availability rate, surpassing the guaranteed 95%, largely due to proficient management by Excelerate Energy, the maintenance operator.

The stable revenue and cash flow are further secured by a long-term energy supply contract with Sui Southern Gas Company (SSGC), which guarantees off-take and has consistently made timely payments despite various challenges. Although the implementation of IFRS-16 increased reported leverage by requiring all leased assets and corresponding liabilities to be booked, it did not negatively impact the net financial position of the company. EETPL’s ability to comfortably service its debt and generate internal cash flow also contributes positively to its financial risk profile.

The ratings hinge on the continuous smooth operation of the terminal and the ongoing financial conduct of SSGC, particularly in terms of punctual payments.